Gold has risen more than 3% and silver by 7% in January-to date, supported by safe-haven demand amid political and economic uncertainties. The main factor supporting prices is the speculation that President-elect Trump will impose tariffs after his inauguration ceremony on January 20.

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The main theme of the first week of 2025 was the strength of the US dollar. The strength of the Greenback may limit the upside potential of dollar-denominated gold, as a higher USD makes gold more expensive for buyers using other currencies.

Gold is expected to finish the year up 27%, its greatest yearly performance since 2010. This spike has been supported by central bank purchases, rising geopolitical risks, and major central banks’ monetary easing. Rising global tensions have supported gold’s resilience this week.

It seems that Gold will not fall below $2500 (~Rs 73000) in the upcoming months due to the expectation of lower interest rates, the continued elevated geopolitical risk, and the uncertainty surrounding the Trump administration’s implementation of protectionism policies.

The expectation of lower interest rates, ongoing elevated geopolitical risk, and uncertainty around implementing protectionism policies under the Trump administration are the main reasons demand will get supported and find a floor for gold prices around $2500 (~Rs 73000) in the coming months and won’t fall below this level.

As gold prices have given around 30% returns this year, we will likely witness a bout of profit-booking by hedge funds and ETFs in December, which might put pressure on the prices. But amid geopolitical worries, prices will stay above $2500 (~Rs 73000).

Gold and Silver saw safe-haven flows last week, and rising tensions between Russia and Ukraine caused renewed unease in the markets. I now anticipate impending buying exhaustion this week in precious metals.

Renewed geopolitical tensions will overcast the Trumponomics and precious metals prices will rebound again this week. Gold prices have made a short-term bottom now and are expected to rebound towards Rs 75000 and Rs 77000 and silver to Rs 92000 and Rs 95000.

Gold and Silver were dumped by 2.5% and 4% last week respectively as several key events caused a lot of price volatility. US Election and announcement of Trump’s Victory, then US FED and BOE cutting interest rate by 25 bps.

Gold has been trading in the up-trend channel for the last year since $1850 (~Rs 56000). Immediate resistance in this channel is around $2800 (~Rs 80000), and support is around $2550 (~Rs 74000). The bullish view is intact as long as gold prices are in this up-trend channel.

Rising for the 23rd week in a row so far in 2024, the price of gold in US dollars has surpassed $2747 (~Rs 78200), up more than 3% from the previous week. While Silver gained 10% in only one week, reaching a high of about $34.32 (~Rs 98220).